Take the PEO Test

Take a 5-question test to see if a PEO could help your company better manage its Human Resource functions.

1)    Are your healthcare costs spiraling out of control?

Most companies who offer health insurance to their employees face double digit rate increases to their premiums annually. According to CNBC.com, “over the past nine years, employee out-of-pocket spending for a family of four increased by 69 percent in the form of higher co-pays and higher deductibles, along with 105 percent employee premium contribution growth. Over the same period, employer premium contributions increased by 62 percent.” PEO’s can offer market buying power through group plans to lower health insurance costs.

If your company’s healthcare costs have increased by more than 7% in the past year then give yourself 1 point.   If not, give yourself a 0.

2)    Do you have to manage multiple vendors to run your Human Resource Department?

When you deal with multiple vendors to operate your organization, it can raise the possibility of misinformation being passed or things being missed. There is a multitude of reasons why it is better to single source your vendor.

  • One point of contact that intimately knows you and your organization
  • Streamlined communication and less chance to misinterpret information
  • Economies of scale increase buying power to get lower rates
  • Multiple specialists in areas of human resources, workers’ compensation and risk management, employee benefits administration, and payroll and tax administration

The raised stakes in business in this era requires precision and flexibility.  Single sourcing your vendors increases the ability to be both expedient and accurate.

If your company manages 2 or more vendors for its human resources the give yourself 1 point.  If not, give yourself a 0.

3)    Are transactional HR related matters tying up key members of your organization?

In small to mid-size organizations, key players often wear multiple hats daily. Perhaps it’s the CFO who is dealing with the HR functions of the company. This person is often pulled into the minute and time-consuming tasks that are better suited to be handled by a dedicated HR professional. Not only are they often out of their depth of knowledge as it relates to these matters, but the company loses a key strategic thinker who would be better served focusing on revenue driving activities. The issue is why build very expensive infrastructure when you can outsource at a fraction of the investment?

If the owner, or key executives of your company, have had to spearhead your HR in the past year give yourself 1 point.  If not, give yourself a 0.

4)    Have you been hit with OSHA fines or lawsuits related to failing to follow regulations?

Business is done at warp speed these days. Gone are the bloated slow responding organizations of yesteryear. The only way to survive and thrive in this shark tank is to do things as cost efficiently and accurately as possible. Due to ever increasing government legislation, it is imperative that companies adhere to the many rules and regulations that are in place. The trouble is, these rules and regulations are constantly in flux. It’s a full-time job trying to maintain compliance. The fines and penalties for missteps are often steep. The best way to deal with them is to avoid them. That’s why having an expert in your pocket is invaluable.

If your organization has been assessed OSHA fines or sued within the past 5 years give yourself 1 point.  If not, give yourself a 0.

5)    Are you just tired of dealing with a function that is very crucial, time consuming, stressful, and yet makes your company zero revenue?

Dotting the I’s and crossing the T’s in the realm of human resources can be tiresome to many. The work that needs to be done is not just vast in nature, but it can be remarkably tedious. Between employee related matters, unemployment claims, onboarding, reports, files and a host of other administrative tasks, it’s no wonder this can quickly overwhelm even the most organized and diligent individual. Why deal with it when you can free yourself of the drudgery at a fraction the cost and a sliver of the stress and aggravation.

If your organization has caught errors in its HR documentation within the last 3 years give yourself 1 point.  If not, give yourself a 0.


Rate Your Score

0 points – Congratulations.  Your company is a well-oiled HR machine with the right people, processes, and policies in place!

1 point – Most companies that do not utilize a PEO have an HR issue at some point or another.  Now would be a good time to do a review with our HR experts to see how your company can be better protected.

2 points –  This is an indication that there are issues with your company’s HR.  A consultation with our experts would be beneficial for you and would help to determine exactly what is going on with your HR.

3 points – Your company has defined HR issues and there may be more.  This type of score indicates that problems exist and may be growing.  Now is the time to address them by consulting with the experts at ABO.

4 points – There should be cause for serious concern at your company about its HR.  With these many issues your company is being exposed to serious risk that it doesn’t need.

5 points – We need to talk ASAP.  Your organization is at serious risk for fines, potential lawsuits, and may be losing a significant amount of money due to poor HR processes and policies.

Why the PEO is clearly the superior solution?

People are comfortable with what they are familiar with, it’s just human nature. When you ask most people what a PEO is, blank stares come back. There is a lot of misinformation regarding the role of a PEO and what their role is. Plain and simple, it isn’t cost effective for small to midsize organizations to build a true HR Department. While larger organizations have this built into their business, usually only Fortune 500 organizations have HR Departments the size of a PEO. The PEO is one group of experts in their given discipline under one roof, one phone call away for all your human resource needs. They can do it faster, more accurately, and at a lower cost than internal staff can. Why not investigate how a PEO may benefit your company? It’s sound business to investigate all potential solutions to make your company better and more profitable.